If you think brick-and-mortar stores are on the verge of extinction, think again. Most people today believe it is only a matter of time before everyone will be buying all their consumer goods online from giant e-commerce sites, such a China’s largest, JD.Com, also known as Jingdong.
But you may be surprised to know that it is top officials at Jingdong itself who are saying: “Not so fast.” JD.Com may be a gigantic e-tail company, but it is not interested in seeing the brick-and-mortar operation go the way of the dinosaur. They also know that e-commerce is still light years away from pushing out traditional stores.
Consider that e-commerce constitutes just 8.5% of retail sales in the Unite States and 15% in China. JD.Com logistics and strategy planners are keenly aware that the owners and manager of physical locations are an invaluable resource. Store owners observe what is happening in their shops every day. That means they have key insights on customer behavior and traffic flow.
Because of this, Jingdong is eager to establish relationships with store owners on city streets across China. In fact, it is making its technology available to brick-and-mortar operations. It’s all about developing “smart consumption” that engenders customer loyalty and retention. It blends the idea that some things can be bought online and some at a physical location. It can be a win-win situation for both platforms.
Then there is the idea of Virtual Reality. In a traditional clothing store, for example, customers can take an article of clothing into a fitting room and try it on. Jingdon is working on ways in which customers can virtually do the same thing in an online environment.
JD.Com is also helping traditional retailer with the concept of “smart supply.” This is leveraged by big data and AI (Artificial Intelligence). The goal is to provide retailers with information about what they want to buy, why, how often and more.
Jingdong may be China’s largest e-commerce site with 300 million active users, but they have no intention of abandoning the old fashioned way of buying things.
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